s7-14-95
Date: 1/17/98 1:08 AM
Robbie Corker
I.B.E.W.
7494 Juniper Ridg RD.
Redmond, OR 97756
country@bendner.com
Dear Mr. Katz:
I am writing to object to the Securities and Exchange Commission's proposed
amendments to rules on shareholder proposals.
The Commission's proposals create many obstacles to shareholders bringing
proposals. They will foster costly litigation in place of cost-effective and
time-proven regulatory mechanisms. These changes are contrary to the expressed
views of Congress in the National Securities Markets Improvement Act of 1996,
encouraging the Securities and Exchange Commission to investigate enhancing
shareholders' ability to submit resolutions "relating to corporate practices and
social issues."
The proposals are objectionable for a number of reasons.
The "personal grievance" exception. The proposed rule would allow companies to
bar proposals without SEC review because the companies assert the shareholders'
motives are "personal." Proponents will be forced to sue in federal court, a
process that for many is prohibitively expensive and time consuming. The
practical effect of this proposal would be to cripple the current shareholder
proposal process.
Resubmission thresholds. The proposed rule would raise the vote percentage
necessary to resubmit a proposal in subsequent years to levels which would have
excluded most past shareholder efforts addressing both corporate governance
questions and corporate policies involving significant social issues. Had the
proposed standard been in effect in years past, virtually none of the corporate
resolutions dealing with excessive executive compensation would have been
considered.
Discretionary voting by management. The proposed rule would allow companies to
solicit proxies from shareholders without giving those shareholders the right to
vote for certain types of shareholder proposals on their company proxy card. It
was just this type of one-sided, management dominated proxy process that led to
the adoption of the current rules in the first place.
Relevance exception. The proposed rule would create a sales dollar value measure
of proposals' relevance that would potentially exclude proposals on issues where
the potential liability or the social issue at stake dwarfed the sales impact of
the issue.
Taken together, the proposed SEC rules disenfranchise shareholders. They
eliminate the voice of the smaller shareholder on the corporate proxy ballot and
at annual shareholder meetings. While I applaud the SEC for reversing the
Cracker Barrel decision, which barred shareholder resolutions having anything to
do with a company's workforce, the proposed rule renders the reversal
meaningless by retaining and strengthening anti-shareholder measures.
Sincerely,
Submit